Starz Chief Warns Investors That “It Will Take Money” To Produce The Original Programs It Needs

Although Starz appears to be off the market for now, CEO Chris Albrecht told investors today that his channel should still be in the catbird seat as digital media grow. But “it will take money” to produce the kind of programming that will set Starz apart from basic cable channels that spend as much as $3M an hour for originals, he said at a conference organized by his parent company Liberty Media. He wants Starz’ shows to have a theatrical feel with iconic, larger than life characters and broad appeal. He assured the audience that he won’t break the bank, though: For example, Spartacus”is shot completely inside a warehouse in New Zealand….This is the way they make theatrical movies now.” Also Starz has decreased its spending on theatrical films. “That money will be reinvested in original programming.” Starz still plans to run theatricals from its premium TV agreements with Disney, which runs to 2016, and Sony, which goes to 2017.

The biggest new opportunities are in digital media: Starz next year will launch its own streaming platform for its pay TV customers, similar to HBO Go, Albrecht says. That will “get us in front of younger eyeballs and make our product as compelling as anything in the premium space.” Albrecht also is “willing to have the conversations” with companies that want to challenge cable and satellite providers by licensing traditional channels for a streamed service. “Someone will do it,” he says. For now, though, he’s focused on making a subscription VOD deal to replace the one with Netflix that Starz decided not to renew. “We are in very active discussions” with other players, he says. Starz backed away from Netflix because the channel wants to be seen as special—deserving a higher price. Albrecht is counting on someone to launch a premium digital subscription VOD service, and if Starz had stuck with Netflix then “we would have made it almost impossible for anyone else to come into this space.”